EDITORIAL: The Peter Moyo legacy
Once the dust settles, the damage is likely to be seen in nominations committees across the country’s boardrooms
It’s unclear right now just how the fracas at Old Mutual between the life assurer’s board and axed CEO Peter Moyo will play out.
At this point, shareholders are split between the pragmatists who want Old Mutual to just pay Moyo out (like All Weather Capital), those who say it would be wrong to pay a cent (like Allan Gray), and those on the fence (like Sanlam).
Since May 24, when Moyo was first suspended, Old Mutual’s share price has fallen 7.3%. So you can see why investors want the nightmare to end. The longer it drags on, the more investors you’d expect to convert to the clique of pragmatists.
But once the dust settles, the damage is likely to be seen in nominations committees across the country’s boardrooms. That the spat reached this stage is a consequence of rampant egos, who failed to place the company’s stakeholders at the centre of their decision making.
So you can expect boards to do far greater due diligence on the individual characters they’re hiring to lead the company from now on. It’s clear that the previous way of doing business — hiring someone, and if it doesn’t work out, quietly axing them — no longer holds.
And even when they do hire someone, expect their corporate lawyers to draw up bulletproof contracts to allow boards to avoid the sort of embarrassing court tussle we’ve seen with Moyo.
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